The U.S. economy is chugging along and retail sales numbers are in a three month uptrend. The rise in consumer discretionary spending, along with related exchange traded funds (ETFs), may be the beginnings of a sustainable U.S. recovery.
The drop in auto sales, which fell by 5.1%, hindered overall sales growth in April as compared to March, report Lucia Mutikani, Richard Leong and Wanfeng Zhou for Reuters. Some analysts belive that the early Easter may have increased apparel sales in March and pushed smaller gains in April. Consumers also took advantage of the “cash for appliances” programs, which increased demand for electronics and appliances.
Core retail sales – the numbers most closely linked with consumer spending component of the government’s GPD report – are widely expected to have inched up further in April. The people at Reuters believe that Treasury prices will likely react to the sales data and the U.S. dollar may appreciate on expectations that the Fed would raise rates sooner as a result of a stronger economy.
Ed Farrell, a director of the Consumer Reports National Research Center, believes that the modest improvements in the Consumer Reports Index indicates consumers are coming out of their recessionary mindset, “but a full recovery will require a substantial period of growth for consumer confidence to fully take hold,” reports Marc Perton for The Consumerist.